Drafts/Checks

Drafts & Checks

By Kaitlyn Unland

​Types of Drafts:

• Sight Draft: draft on which payment is due immediately when presented to the drawee (shipped goods)

• Time Draft: ​draft payable on a date set on the instrument or one that is payable after the running of a specified period after the draft's date (bills)

Open Ended

What is the difference between a sight draft and a time draft?

​Checks:

• Check: type of draft by which a bank depositor orders the bank to pay money, usually to the order of a third party or to the bearer of the instrument

Checks:

Bank's refusal to pay a check when due​

​Dishonor:

Banks promise to the depositor to pay checks when presented if sufficient funds are available in the depositor's account

​Honor:

Open Ended

What is the difference between honoring and dishonoring a check?

​Promissory Notes:

• Promissory Note: unconditional written promise to pay money to order or to bearer (loans)

• Maker: ​person who executes a promissory note

Subject | Subject

Multiple Choice

What is the person who executes a promissory note called?

• Drawer

• Maker

• Drawee

• Payee